It’s fortunate for those in the professional valuation industry that people have different opinions and perspectives on the same topics. Otherwise, there would be a lot less demand for independent appraisal work.
In this utopian fantasy world, certified and accredited valuation reports would still be needed in certain markets, such as accounting, banking, and insurance requirements; however, much of the litigation work that appraisers take on would essentially be eliminated altogether.
Most experienced appraisers rely on a significant portion of their business to come from these types of projects where disputes arise. Lawyers who practice business law, as well as divorce attorneys, who often represent the clients directly in these cases, would also have a difficult time staying relevant.
Many experienced appraisers will work with these clients on dispute work, which will come from a number of different situations. Here are a few examples:
Partner Buyouts
One of the most common types of disputes. What is the value of a partner-owned company, and how should discounts be applied to minority interests? Both of these opinions will vary, and the odds of coming to an easily compromised settlement in a buyout are low.
Liability Damages Claims
One business suing another for a deal that goes “sideways” usually involves a liability case where damages occur as part of a transaction or event. The odds of these cases working out on an amicable basis are even more remote, given the parties involved arguing over not only the extent of the loss but also who is responsible. People generally don’t like to admit or accept blame for anything in business or personally.
Divorce Cases
We’ve all seen the statistics about how many marriages end in divorce. It’s rather sad that this is the reality. However, as an appraiser, you can bet one side or the other will reach out to you when there are company and/or tangible assets involved with the split. Sometimes, the assets are jointly owned, and on other occasions, only one ex-spouse has an equitable interest. Either way, there is a lot of unsettled disagreement when trying to formalize the separation fairly.
All of these situations will ultimately require an independent third party to step in and assist with facilitating a settlement or arguing their case in court. For the qualified appraisers out there, this creates a multitude of opportunities to generate steady sources of revenue and growth.